[Corporate Fraud\Manhattan D.A. Vance]
D.A. Vance: “If you compromise the integrity of New York’s core industries and financial markets, our Office will hold you criminally accountable.”
Photo: Wikimedia Commons
Manhattan District Attorney Cyrus R. Vance, Jr., today announced the guilty pleas of former Newsweek and Christian Media chiefs.
Etienne Uzac, former Co-Owner and Chairman of IBT Media, Inc. (“IBT”) a/k/a Newsweek Media Group, and William Anderson, former CEO of Christian Media Corporation (“CMC”) and former Olivet University (“OLIVET”) Trustee for engaging in a scheme to fraudulently obtain $35 million from lenders.
Uzac and Anderson each pleaded guilty in New York State Supreme Court to Money Laundering in the Second Degree and Scheme to Defraud in the First Degree
This was for their roles in fraudulently obtaining over $35 million in financing for IBT, CMC, and OLIVET, and then laundering the money through a network of corporate bank accounts to mask the origin of the funds, and to disguise the fact that the funds were not being used to purchase equipment.
The majority of the money was used to purchase land in New York and California, fund day-to-day operations, and for purposes unrelated to the stated purpose of the financing.
Uzac and Anderson used some of the money to make monthly payments on previously-received financing, helping to ensure that the lenders would not notice the scheme and would continue to fund fraudulent financing transactions. The defendants are expected to be sentenced on April 20, 2020.
“If you compromise the integrity of New York’s core industries and financial markets, our Office will hold you criminally accountable whether you’re a low-level employee or a high-powered CEO,” said Vance. “With this unique mission and unique set of skills, our storied Major Economic Crimes Bureau has again taken down a massive fraud scheme through which a group of sophisticated criminals illegally moved tens of millions through our Manhattan marketplace by brazenly overstating the financial health of their companies. I thank our prosecutors and investigators for their meticulous investigation, and encourage anyone aware of a similar scheme, in any industry, to contact our Office.”
Three co-defendants previously pleaded guilty in connection with their respective roles in the scheme. On February 11, 2020, IBT pleaded guilty to Scheme to Defraud in the First Degree and paid forfeiture in the amount of $50,000 for its part in the equipment financing scheme.
Oikos Networks (“OIKOS”) also pleaded guilty to Scheme to Defraud in the First Degree for its role in the scheme; Oikos held itself out as an independent equipment vendor and represented that it would provide OLIVET, IBT and CMC with computer equipment using the funds provided by equipment lenders. Instead, Oikos transferred nearly all of the funds to accounts controlled by Uzac, Anderson, OLIVET, IBT, CMC and others, where the funds were used as described above.
On December 18, 2019, CMC pleaded guilty to Falsifying Business Records in the Second Degree and Criminal Contempt in the Second Degree in connection with providing fraudulent information to an equipment lender and intentionally disobeying and failing to produce documents responsive to a subpoena issued by the District Attorney’s Office. CMC forfeited $50,000 in connection with its guilty plea.
Assistant D.A.s Solomon Shinerock and Daniel Poulos handled the prosecution of this case under the supervision of Assistant D.A.s Julieta V. Lozano, Deputy Chief of the Major Economic Crimes Bureau, Steve Pilnyak, Deputy Chief of the Major Economic Crimes Bureau, and Christopher Conroy, Chief of the Major Economic Crimes Bureau, as well as Executive Assistant D.A. Michael Sachs, Chief of the Investigation Division. Senior Investigator Anthony Santoro, Forensic Accountant Investigator Ken Zorn, Investigative Analysts Matthew Nelson, Talya Nevins, Anna Lipin, and Alessandro Schooley assisted with the investigation. District Attorney Vance thanked the New York State Police and particularly Troop K for its assistance with the investigation.
Defendants:
WILLIAM ANDERSON, D.O.B. 1/14/1985 New York, New York Convicted:
- Money Laundering in the Second Degree, a class C felony, one count
- Scheme to Defraud in the First Degree, a class E felony, one count
ETIENNE UZAC, D.O.B. 1/1/1983 New York, New York Convicted:
- Money Laundering in the Second Degree, a class C felony, one count
- Scheme to Defraud in the First degree, a class E felony, one count
